Chile lowers petrol pump prices in wake of high inflation

SANTIAGO Nov 19 (Reuters) - Chile said on Wednesday that it
would lower the price band at which petrol is sold to gas
stations, reflecting a fall in the oil price and government
worries about persistently high inflation.

Chile imports nearly all the fuel it consumes, most of which
is purchased and sold on to retailers by state-run firm ENAP
.

Earlier this year, the government introduced a mechanism to
cap fuel price volatility.

However, since then, global oil prices have dropped by
around a third.

"The government has decided to modify the parameters of the
mechanism's price band...to speed the passing on of
international prices to local consumers," Finance Minister
Alberto Arenas told reporters.

On average, fuel prices will fall by 62 Chilean pesos
(around 10 U.S. cents) a liter from Thursday.

High petrol prices and a weakening peso have contributed to
surging inflation in Chile in recent months. It now stands at
5.7 percent, well above the central bank's tolerance range.

The measure announced Wednesday could cool inflation by
around one percentage point in November, "and some percentage
points more in the year," said Arenas.